Jose Casillas and Robert Houle purchased an older home that had been divided into apartment units. Their initial plan was to renovate and resell the home, but they decided instead to keep it and lease out the apartment units. The two agreed that Casillas would provide the funding and Houle would supervise the renovations. They also agreed that once Casillas was reimbursed for his investment, the two would split the profits equally. To facilitate this plan and purchase the property, Casillas and Houle formed Pershing LLC. Pershing purchased the property for $100,000 using money loaned by Casillas. However, the renovations took longer and cost more money than Houle had planned.

Eventually, Casillas was forced to foreclose on the property, and Casillas and Houle sued each other. Part of Houle’s argument was that although he and Casillas formed an LLC, the two were actually partners. That is, the formation of the LLC was simply to facilitate the initial plan to purchase the property, lease the apartments, and share the profits. Casillas argued that no partnership was formed, primarily because neither he nor Houle signed any written partnership agreement. What do you think of Houle and Casillas’s arguments? How did the court ultimately rule?